The extent of legal reserve policy effectiveness for the influence of monetary mass : the case of Algeria from 2001 to 2018

Abstract EN

The study aims to identify how effective the legal reserve policy is in influencing the money supply in Algeria, using the Vector auto-regression technique (VAR) to estimate the impact of the legal reserve on the money supply during the period from 2001 to 2018.

The study fou.

nd that the size of the legal reserve is an important interpreter of the variations in the money supply circulating in the short, the medium and even in the long term.

This confirms the effectiveness of its money supply control policy inside the Algerian economy, as it is one of the methods approved by the Central Bank and available under the ineffectiveness of the financial market to carry out the operations of the open market as the most important alternatives for influencing the amount of money